SHOP's Merchant Solutions Surge: Is GMV Strength Driving More Upside?

Shopify’s SHOP accelerating GMV momentum continues to fuel significant upside in Merchant Solutions, its largest and most dynamic revenue engine. A robust 32% GMV surge underscores how transaction growth reliably converts into Merchant Solutions' strength. This tight correlation remains central to Shopify’s long-term bullish narrative.

Merchant Solutions surged as more activity flowed through Shopify Payments, which reached 65% penetration in the third quarter of 2025. Shop Pay also continued its impressive climb, boosted by growing adoption among both smaller merchants and global brands. As these tools scale, Shopify captures more value from every order, enriching its monetization per GMV dollar.

International strength added further momentum. GMV outside North America accelerated sharply, led by Europe, where enhancements in payments, fulfillment options and cross-border capabilities are helping Shopify deepen its global footprint. Meanwhile, newer channels such as offline retail and B2B commerce continued to gain traction, with steady offline GMV growth and B2B GMV nearly doubling, broadening Shopify’s addressable market.

Supporting this momentum is Shopify’s steady product innovation. AI-powered tools like Sidekick enhance merchant efficiency, while expanded logistics integrations with partners like Global-e, Amazon MCF and DHL are smoothing the path.

With nine straight quarters above 20% GMV growth and the Zacks Consensus Estimates projecting revenues to rise 28.78% in 2025 and 21.93% in 2026, Shopify’s Merchant Solutions engine appears well-positioned for further upside as GMV continues to expand.

Shopify Faces Growing Rivals

Competitive pressure on Shopify is intensifying, driven by the rapid advances of Commerce.com CMRC and Wix.com WIX in the e-commerce arena.

Commerce.com is rapidly strengthening its position as a serious challenger to Shopify. CMRC’s enterprise-focused, composable architecture and AI-driven automation appeal to large brands seeking advanced flexibility. With the company reporting steady subscription revenue growth and deepening partnerships with PayPal, Microsoft and Google, its platform is becoming increasingly powerful. As Commerce.com expands its intelligent, enterprise-grade solutions, Shopify faces intensifying competition from a technologically aggressive rival.

Wix.com evolved from a simple drag-and-drop builder into a full e-commerce platform offering merchants robust tools to design, manage, and grow online stores. Wix.com’s affordability, ease of use, and strong positioning in a cloud-driven, AI-enhanced commerce landscape make it increasingly competitive. Recent AI-powered integrations with PayPal further strengthen WIX’s capabilities, underscoring why Shopify now faces mounting pressure from fast-advancing rivals.

SHOP’s Share Price Performance, Valuation & Estimates

Shopify shares have jumped 47.9% year to date, outperforming the broader Zacks Computer and Technology sector’s return of 25%. However, the stock has trailed the Zacks Internet Services industry, which has rallied 63.2% over the same period.

SHOP’s YTD Price Performance

Shopify stock is overvalued, with a forward 12-month price/sales of 14.76X compared with the broader sector’s 6.61X. SHOP has a Value Score of F.

SHOP’s Valuation

The Zacks Consensus Estimate for 2025 earnings is pegged at $1.46 per share, up a penny over the past 30 days. This suggests 12.31% year-over-year growth.

Shopify currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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